Background
Our client delivers pharmaceuticals & medical devices to hospitals, wholesalers and pharmacies from their NDC. The facility services four business units with some overlap in customer base. Each business unit has further product groups.
The site houses 7,500 to 9,000 SKUs and typically fulfils 541 order lines per day to a customer base with 900 delivery points. Deliveries are made using a combination of cages, pallets and parcels.
Challenge
The healthcare distributor was due to migrate their NDC operations 60 miles to an existing facility, previously used by another business unit within their group. The transfer provided the opportunity of reviewing the warehouse operation to maximise efficiency and reduce cost.
The objective of the project was to determine the optimum operating method and layout for the new site, whilst minimising capital outlay by re-using existing racking and MHE.
Solution
The project followed the D&R methodology for warehouse design projects, which consists of the following discrete steps:
- Survey of current and destination sites.
- Data collection and profiling.
- Baseline development:
- Resource modelling
- Product & location mapping
- Growth planning
- Scenario development:
- Picking systems
- Optimise storage media
- Stock to layout allocation
- Options assessment.
- Review & reporting.
One challenge was the lack of accurate product cube data, which was reverse engineered by measuring individual storage location dimensions and linking them to their contents.
Key outputs
- The most productive picking methods
- The optimum mix of storage media and layout, including rack quantities, apertures, and shelving units
- Design of the packing and despatch areas
- Design of the receipts area
- Summary of required staffing levels, shift structure and MHE
- SKU and location level storage allocation plan
As part of the evaluation, the functionality of the WMS was reviewed to identify any system constraints in changing how the warehouse is operated.
The final output included a stock allocation at SKU and location level which was validated by the client and used in detailed migration planning.
Results
The project supported the client’s NDC migration in a number of ways:
- Provide a work around for the missing product cube data
- Optimise the existing rack layout to the new business use without major capital outlay
- Productivity and throughput were maximised through stock layout optimisation
- A clear and detailed plan as to where to position each stock item in the new layout
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